Portland State University will not acquire the Oregon College Art and Craft, setting the stage for a possible closure by the financially struggling arts institution.

On Friday, Portland State University posted a statement on its website.

"Based on our research, it is not financially feasible for us given other budget challenges that we face," PSU President Rahmat Shoureshi said in a statement.

"We explored this because we were excited about the potential opportunity that an acquisition would honor the legacy of art and craft at OCAC, support the arts in our region and bolster our own College of the Arts," Shoureshi continued. "But our study of different acquisition scenarios, including those involving private philanthropy, showed the potential costs would be too high for PSU."

Located in Southwest Portland, OCAC, founded in 1907, offers bachelors and master's degree programs in the fine arts.

"Call it a day late and a dollar short," says real estate investor Jordan Schnitzer, who, with his family, has been a patron of OCAC and became involved in efforts to save the college after learning of the school's financial woes. "If we'd worked on it a few years ago, we might have had a different answer."

Schnitzer praised PSU's "tremendous effort" to find a way to take over the program and added the problems should offer a potential warning to nonprofit boards.

"The community nonprofits are fragile jewels of the community," Schnitzer says. "The board …is ultimately responsible for the success of the nonprofit. Too often, it's been said, smart people leave their brains at the doorstep when they enter a civic meeting."

OCAC had previously sought a merger with Pacific Northwest College of Art, The Oregonian reported earlier this month.

OCAC officials say the PSU decision does not spell the end of efforts to save the school.

"This does not mean OCAC will close," says Elizabeth Loulan, the school's director of partnerships.

Other local high-education institutions with arts offerings have also struggled. Last year, both Marylhurst University in Lake Oswego and the Art Institute of Portland closed.